Water plant posts profit

Thanks to an increase in rainfall, Pepper’s Ferry Regional Wastewater Treatment Authority’s bottom line did a $140,000 about face in October.
According to Executive Director Clarke Wallcraft the authority was posting a more than $14,000 deficit for the fiscal year at the end of September. However, by the end of October, increased flows into the plant had boosted the Authority’s revenue to the point it was posting a profit of more than $154,000.
As a result, Wallcraft said a possible rebate to the jurisdictions served by Pepper’s Ferry is still possible down the road “if those kinds of flows continue” during the year.
“From the staff’s standpoint, it’s still on the table,” he added.
Wallcraft said the change in the bottom from September to October is a good example of “how much it can flip-flop in one month.”
However, a Radford City representative on the Authority’s Board of Directors, suggested any rebates need to wait.
“We need to make sure (revenues are) okay before we jump the gun,” said Robert Asbury. He suggested the drastic nature of the change from one month to the next is all the more reason to hold off on rebates because “it could go back to the negative.”
According to Pepper’s Ferry Superintendent Mac McCutchan, the average flow into the plant in October was 3.8 million gallons per day (MGD) and in November it was 4.5 MGD.
Three inches of rainfall recorded at the Fairlawn plant Nov. 11-12 bumped up the average flow to 10.5 MGD on the 11th and 13.6 MGD on the 12th. McCutchan said flows averaged six to seven million gallons per day for a period of three to four days after the rainfall.
“It was a huge event for us,” he said, noting that all equipment at the plant performed satisfactorily and there were no system bypasses or overflows as a result of the influx of wastewater into the system.
Even if the Authority decides to issue rebates to the jurisdictions it serves, Wallcraft noted that it will be up to the jurisdictions to decide whether to pass the rebates on to their customers through rebates or a rate reduction.
“Logistically, it would probably be hard to do,” he said.
If rainfall continues to be above normal and flow remains high at the regional wastewater treatment plant, it is feasible a rate decrease could be requested at some point, the executive director said Thursday.
Of course, the potential for a decrease is all resting on “ifs” at this point.
However, Pepper’s Ferry Regional Wastewater Treatment Authority Executive Director Clarke Wallcraft said continued excessive rainfall could prompt him to ask the board of directors to lower the Authority’s rates sometime down the road.
Wallcraft pointed out to the board Thursday that flows into the plant were so high during the past few months that the Authority was able to “pick up” about $180,000 in lost revenues in May alone. He is predicting about $150,000 to $180,000 more will be picked up when June’s revenues are closed out.
With the fiscal year ending June 30, the director said that means the Authority will be able to close out the 2008-09 fiscal year with a net income. Not only will the Authority have made enough to cover contingency funds set aside due to the drought, but it also will have netted a profit above that amount.
If the trend continues, he said a rate decrease could be requested because “we don’t want to be a cash cow.”
He also noted that money that has been budgeted for capital projects has not been spent because of the uncertainty as to when the drought would end.
Wallcraft said he would monitor rainfall and flows over the next four to six months of the new fiscal year to see whether the trend is continuing before deciding whether to seek a rate reduction.
“If we don’t continue to get excessive rain,” a rate reduction won’t be needed,” he said.
Pulaski County representative Ron Coake asked if it wouldn’t be better to reimburse the localities by cutting checks or allowing credits than to change the Authority’s rate structure.
Wallcraft said that approach could be taken. However, he added that it would be easier on the staff in terms of record keeping to lower the rates.
The director said lowering the rates during the fiscal year wouldn’t require a public hearing the same way a rate increase does.
Coake asked if a hearing would have to be held to raise the rates again once they’ve been lowered in the event flows and revenues drop off again.
Wallcraft said he doesn’t believe a new hearing would be required since the higher rates have already been advertised for the initial rate increase.
Authority attorney Jim Cornwell said he would have to see details of how Pepper’s Ferry would intend to handle rate changes before deciding whether a hearing would be required.
Of course, even if Pepper’s Ferry chose to reduce its rates to the member jurisdictions, that does not mean citizen utility bills would decrease. It would be up to each locality whether to pass on the savings to its customers.

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Water plant posts profit

Thanks to an increase in rainfall, Pepper’s Ferry Regional Wastewater Treatment Authority’s bottom line did a $140,000 about face in October.
According to Executive Director Clarke Wallcraft the authority was posting a more than $14,000 deficit for the fiscal year at the end of September. However, by the end of October, increased flows into the plant had boosted the Authority’s revenue to the point it was posting a profit of more than $154,000.
As a result, Wallcraft said a possible rebate to the jurisdictions served by Pepper’s Ferry is still possible down the road “if those kinds of flows continue” during the year.
“From the staff’s standpoint, it’s still on the table,” he added.
Wallcraft said the change in the bottom from September to October is a good example of “how much it can flip-flop in one month.”
However, a Radford City representative on the Authority’s Board of Directors, suggested any rebates need to wait.
“We need to make sure (revenues are) okay before we jump the gun,” said Robert Asbury. He suggested the drastic nature of the change from one month to the next is all the more reason to hold off on rebates because “it could go back to the negative.”
According to Pepper’s Ferry Superintendent Mac McCutchan, the average flow into the plant in October was 3.8 million gallons per day (MGD) and in November it was 4.5 MGD.
Three inches of rainfall recorded at the Fairlawn plant Nov. 11-12 bumped up the average flow to 10.5 MGD on the 11th and 13.6 MGD on the 12th. McCutchan said flows averaged six to seven million gallons per day for a period of three to four days after the rainfall.
“It was a huge event for us,” he said, noting that all equipment at the plant performed satisfactorily and there were no system bypasses or overflows as a result of the influx of wastewater into the system.
Even if the Authority decides to issue rebates to the jurisdictions it serves, Wallcraft noted that it will be up to the jurisdictions to decide whether to pass the rebates on to their customers through rebates or a rate reduction.
“Logistically, it would probably be hard to do,” he said.
If rainfall continues to be above normal and flow remains high at the regional wastewater treatment plant, it is feasible a rate decrease could be requested at some point, the executive director said Thursday.
Of course, the potential for a decrease is all resting on “ifs” at this point.
However, Pepper’s Ferry Regional Wastewater Treatment Authority Executive Director Clarke Wallcraft said continued excessive rainfall could prompt him to ask the board of directors to lower the Authority’s rates sometime down the road.
Wallcraft pointed out to the board Thursday that flows into the plant were so high during the past few months that the Authority was able to “pick up” about $180,000 in lost revenues in May alone. He is predicting about $150,000 to $180,000 more will be picked up when June’s revenues are closed out.
With the fiscal year ending June 30, the director said that means the Authority will be able to close out the 2008-09 fiscal year with a net income. Not only will the Authority have made enough to cover contingency funds set aside due to the drought, but it also will have netted a profit above that amount.
If the trend continues, he said a rate decrease could be requested because “we don’t want to be a cash cow.”
He also noted that money that has been budgeted for capital projects has not been spent because of the uncertainty as to when the drought would end.
Wallcraft said he would monitor rainfall and flows over the next four to six months of the new fiscal year to see whether the trend is continuing before deciding whether to seek a rate reduction.
“If we don’t continue to get excessive rain,” a rate reduction won’t be needed,” he said.
Pulaski County representative Ron Coake asked if it wouldn’t be better to reimburse the localities by cutting checks or allowing credits than to change the Authority’s rate structure.
Wallcraft said that approach could be taken. However, he added that it would be easier on the staff in terms of record keeping to lower the rates.
The director said lowering the rates during the fiscal year wouldn’t require a public hearing the same way a rate increase does.
Coake asked if a hearing would have to be held to raise the rates again once they’ve been lowered in the event flows and revenues drop off again.
Wallcraft said he doesn’t believe a new hearing would be required since the higher rates have already been advertised for the initial rate increase.
Authority attorney Jim Cornwell said he would have to see details of how Pepper’s Ferry would intend to handle rate changes before deciding whether a hearing would be required.
Of course, even if Pepper’s Ferry chose to reduce its rates to the member jurisdictions, that does not mean citizen utility bills would decrease. It would be up to each locality whether to pass on the savings to its customers.